Enterprises are increasingly dependent on the cloud, and that’s opening new avenues of business for multi-tenant data centers (MTDCs). Where data center operators might have focused previously on colocation and meet-me rooms, they now see an opportunity to bring the enterprise into their four walls as a customer for interconnection services. It’s a potentially vast market but one that’s unfamiliar to many MTDCs, and they may need to enlist the help of partners that might also end up being competitors.
At the heart of all this activity is the move to the cloud. The migration is neither universal nor linear. 451 believes in the hybrid IT model, in which a mix of public and private clouds will be the norm for many enterprises for a long time, and in fact we’re seeing some workloads being moved out of the public cloud and back into the private cloud. That could benefit MTDCs directly, because enterprises are less and less interested in running their own data centers. The private cloud gets hosted elsewhere, usually as a tenant inside an MTDC.
So that’s one angle where enterprises supply data centers with business. But what about all those workloads migrating to the public clouds? How does that help the MTDC?
In some cases, the enterprise might want a private connection to the cloud, to avoid the performance and security issues associated with Internet access. These connections – services such as AWS Direct Connect and Azure ExpressRoute – have to be accessed from an MTDC, at the insistence of the public clouds.
But the real opportunity comes from the fact that enterprises are using multiple clouds. Sometimes it’s by accident; an enterprise using IBM Cloud acquires a startup built on AWS, for instance. Beyond that, the applications used by the enterprise are becoming SaaS based – turning into cloud. Salesforce.com is a prime example, and Oracle is likewise cloudifying its databases and trying to entice its customers to Oracle Cloud. Eventually, we think enterprises would like to be able to play arbitrage among these clouds, situation workloads in both Azure and Google Cloud Platform, for instance, ping-ponging between the two based on price and performance considerations. That doesn’t seem feasible yet, considering the clouds’ operating environments are incompatible – but vendors and service providers tell us that cloud-to-cloud traffic is happening already, and enterprises would certainly like to see the industry develop ways to avert cloud lock-in.
The point is that it’s getting messy, with the enterprise connecting to multiple outside parties. These connections could all be considered mission-critical, too, because enterprise IT is becoming distributed, outward toward the cloud. The enterprise network has to transform accordingly, reaching out to all those distant clouds.
Equinix was early to recognize the opportunity here. Rather than reaching from an enterprise HQ or data center out to each cloud, creating one network tendril after another, why not use a hub-and-spoke model? These clouds and SaaS providers are already tenants inside an MTDC. If the enterprise becomes a tenant as well, occupying a cage or a few racks, or even hosting a private cloud in the data center, connection to these clouds simplifies to a cross-connect.